Monday, August 22, 2016

Utah's Seasonally Adjusted Unemployment Rates

Seasonally adjusted unemployment rates for all Utah counties have been posted online here.

Each month, these rates are posted the Monday following the Unemployment Rate Update for Utah.

For more information about seasonally adjusted rates, read a DWS analysis here.

Next update scheduled for September 19th.

Friday, August 19, 2016

Utah's Employment Situation for July 2016

Utah's Employment Situation for July 2016 has been released on the web.

Find the Current Economic Situation in its entirety here.

For charts and tables, including County Employment, go to the Employment and Unemployment page.

Next update scheduled for September 16th, 2016.

Tuesday, August 16, 2016

Age and Employment in the Uintah Basin 

People work (or choose not to work) , in part, depending on where they live and how old they are. People also prefer to live in different places. Factors such as employment opportunities, amenities, or even family ties dictate to such. In like fashion, some industries attract a certain age demographic and are necessarily located in certain places. The US Census Bureau tracks data that can shed light on some of this variation. It allows economists to analyze the differences in age groups in different areas and industries. The graph below shows employment by age in Utah, the Uintah Basin, (Duchesne and Uintah counties), and the Uintah Basin mining sector. For accounting purposes, all extractive industries are shown but the overwhelming majority of these jobs are in oil and gas. Mining, as an industry, was singled out due to its prominence in the Uintah Basin’s economic foundation.

The age make-up of the oil and gas industry is different from the Utah and Uintah Basin profile. A striking difference is in the 16-24 year age grouping (known as a cohort). Both areas have more workers in this cohort than in the Basin’s mining industry. The relative lack of the 16-24 cohort in the oil and gas industry can be explained by the industry’s need for an educated work force; the American Petroleum Institutes’ basic certification program requires 150 hours of class time. In contrast, a bachelors degree requires 360 hours.

Of interest is the difference between the oil and gas industry and basin and state in the 25-44 cohorts. These ages have a significant presence in this industry. Older cohorts are accordingly less represented. It is speculated that these jobs are physically demanding and are accepted more readily by workers in the “prime of life.” Lastly, it stands to reason that if workers in the 25-34 cohort are heavily represented in the oil and gas industry, they must be less represented in other industries. Retail trade and accommodations have strikingly lower counts of workers in this cohort; the proportions being 17 percent and 19 percent respectively.

Friday, July 29, 2016

The Infrastructure Labor Market

The labor force is made up of people. People vary in every conceivable way. One person is artistic while another can only draw stick people. One person might be able to disassemble and reassemble a car engine while another might not know what an alternator is. We are different. We have different aptitudes and abilities. Parallel to this variability, jobs are different. High levels of education do make it possible to work in high-skill occupations that return high incomes. But not everyone is cut out for higher education or has the means to obtain higher education. Therefore, they might end up in “lesser” or “unimportant” jobs. But is that accurate? Are their job options inferior and unimportant?

A recent Brookings Institution report brings to light a segment of the economy that is highly important yet is dependent upon the labor force that may not be built for, have the economic means, or desire to attain a college degree or higher. Brookings identifies a niche they call the infrastructure economy. As Brookings notes, “Infrastructure helps facilitate the exchange of information, drive production, and deliver resources, spanning multiple sectors of the economy and serving as a foundation to long-term growth.” It goes further to note that “Infrastructure jobs depend on a steady stream of talent to construct, operate, design, and govern the country’s major physical assets.” 

Brookings also documents why these infrastructure jobs can appeal to the individual. “Infrastructure occupations also boast competitive wages with relatively low barriers to entry, frequently paying up to 30 percent more to workers with a high school diploma or less compared to those in all other occupations. Plumbers, truck mechanics, and power line installers are among the numerous infrastructure occupations that fall into this category, which tend to emphasize on-the-job training rather than higher levels of formal education.”

Brookings identified 95 occupations that support the infrastructure foundation. Their work was well founded and designed. This intrigued us to develop a profile of said infrastructure configuration for the Utah economy. We could not replicate the Brookings work in terms of finalizing upon infrastructure industries, but we could place our focus instead upon all infrastructure occupations. Infrastructure occupations do not have to be found in only infrastructure industries. A helicopter pilot, an infrastructure occupation, may fly a medical helicopter for a hospital, even though said hospital is not categorized as an infrastructure industry. What is important is that there are occupations that Brookings has identified as key occupations that help to keep the economy operating, growing, designed, and governed. And a practical appeal is that many of these jobs offer low barriers to entry while supplying competitive wages.

 Across the nation, these occupations number 11.9 million, or 8.8 percent of all occupational employment. In Utah, these jobs number around 121,400, also 8.8 percent of all occupational employment. Again, the appeal of these jobs is not just that they fundamentally support so many other jobs and industries in the economy, but that these jobs don’t require a high level of education or formalized training for entry. Oftentimes these occupations emphasize only on-the-job training. Yet, these jobs pay on average 22 percent higher in Utah than other occupations that are willing to accept only a high school diploma or less.

Utah’s higher proportion of employment relative to the nation in various infrastructure occupations include reservation and transportation agents/clerks, transportation inspectors, transportation attendants, forest and conservation technicians, petroleum refinery operators, and airfield operations specialists, among others. Utah does have its unique structuring across its different geographic regions, and this will include the possibility of a different profile of the Infrastructure economy in each local region.

The following is an infrastructure profile for the Carbon, Daggett, Emery, Grand, San Juan, and Uintah Counties, collectively known as the Eastern Region. Eastern Utah There are 7,165 infrastructure jobs in the Eastern Region. This constitutes 14 percent of all employment. Relative to the U.S., these jobs are more concentrated in the region; infrastructure jobs are 1.5 times more prevalent in this region than they are nationally.

The Eastern Region economy is dominated by natural resource extraction, and there is considerable overlap between this industry and infrastructure related occupations. Most prominently represented are heavy truck and tractor-trailer drivers. These jobs are 3 times more prevalent in the region than in the U.S. economy as a whole. In 2014, there were 2,402 truck driving jobs in the Eastern Region, or a third of the infrastructure job base. That occupation is expected to grow by 7.5 percent by 2024. The 2015 median wage was $23.39/hour, which is considerably above the statewide wage of $20.37/hour. 

Infrastructure jobs in the U.S. are projected to grow at 7.8 percent by 2024. This is slightly less than the 8.1 percent projected for the Eastern Region as a whole. Accordingly, the share of infrastructure jobs nationally is projected to decline slightly from 2014 levels. Infrastructure jobs requiring less than a Bachelor’s degree pay roughly 32 percent more than similar jobs in the overall Eastern Utah economy. The employment-weighted median wage for jobs not requiring a college degree is $22.70/hour; the analogous number for non-infrastructure jobs is $17.25/hour.

These jobs usually require moderate educational attainment. Almost 43 percent of these occupations require a high school diploma or equivalent. About an equal percentage require some post-secondary education. Only 13 percent of the occupations are open to workers with less than high school education.

 Infrastructure occupations usually require at least modest on-the-job training. Some 55 percent of occupations involve short term training. Long term on-the-job training is required for 20 percent of infrastructure jobs

Wednesday, April 20, 2016

Vernal Labor Market Information is “OnTheMap”

Vernal Labor Market Information is “OnTheMap”

The Census Bureau’s online mapping tool provides a wealth of location-specific labor market information

“If you want to put yourself on the map, publish your own map.” - Ashleigh Brilliant

This isn’t your same old blog post about data. Instead of analyzing and sharing data, this post covers how to access an extremely useful “big data” labor market information tool. What is this tool? The U.S. Census Bureau’s OnTheMap web-based mapping and reporting application. 

What’s so great about OnTheMap? Typically, we report labor market information at the state and county level. Local-level data is harder to come by. Along with the ability to provide labor market profiles of small and large nonstandard areas, OnTheMap graphically demonstrates where people work and where workers live. Users can define their own geographies and obtain data and maps at the census-block level of detail. This flexibility can quickly provide information for emergency and transportation planning, site location and economic development.

  • Do you want to understand commuting patterns for a particular area? OnTheMap can generate maps of outflow and inflow. 
  • Do you want to know the basic characteristics of workers in your town? OnTheMap has that information. 
  • Do you want to identify the employment characteristics along a specific stretch of highway? OnTheMap can deliver that data. 
  • Do you want to discern how many workers live within a 50-mile radius of a particular site? OnTheMap delivers.

Next, the mayor wants to know how many workers travel into Vernal for employment. OnTheMap suggests that far fewer workers commute in than out of Vernal. In-commuters are most likely to drive from outside the city limits.

Labor Market Characteristics

Now, these local government officials have decided they would like to know the characteristics of those folks that work or live in Vernal. OnTheMap can provide age-group, earnings, industry, race/ethnicity, gender and educational attainment information. For example, OnTheMap shows the following characteristics for working residents of Vernal:

·        30 percent are 29 years or younger
·         42 percent make more than $3,333 a month
·         17 percent work in the oil and gas industry
·         6 percent are Latino
·         15 percent have at least a Bachelor’s degree
·         48 percent are female

Getting Specific

A company thinking of locating to Vernal, is interested in the number (and characteristics) of workers within a standard commuting distance of a particular worksite. Economic development professionals can specify a particular radius and obtain a report. Other shapes (donut and plume) are also available. In addition, users can draw their own polygons in OnTheMap. To determine how many workers may be inconvenienced by a road construction project, just draw a line along the length of the project and “buffer” the selection. 


You begin to see what a valuable informational tool OnTheMap can be for planning and economic development purposes. OnTheMap is available here:

Tuesday, April 19, 2016

Uintah County and the Oil and Gas Industry 

The Uintah Basin began commercially producing natural gas and oil in 1925 and 1949. After reaching average daily crude oil production of 44,000 b/d in 1985, annual crude oil fell by more than half, to an average 20,000 b/d in 2002. However, Uintah crude oil production has roared back to life since, rising at a trend-line growth rate of 12% per year through 2014 before tailing off with the current drop in prices. The production growth in the Uintah Basin has been led by a number of companies, including Newfield Exploration (NFX), QEP Resources, Anadarko Petroleum, Crescent Point Energy, Bill Barrett Corporation, Linn Energy, Ultra Petroleum, and Petroglyph, among others. Unsurprisingly, energy production has been the lynchpin for Uintah County’s economy.

Table 1 shows the correlation between mining (oil and gas extraction) and other sectors in the economy. Correlation coefficients measure the strength of association between two variables. The value of a correlation coefficient ranges between -1 and 1. The greater the absolute value of a correlation coefficient, the stronger the relationship. A positive correlation means that if one variable gets bigger, the other correlated variable also grows. A negative correlation would see one variable grow while another correlated variable declines.

Table 1

Uintah County Industry Correlations and Market Shares
Correlation Coefficient
Labor Market Share
Mining (21)
Utilities (22)
Construction (23)
Manufacturing (31)
Wholesale trade (42)
Retail trade (44)
Transportation and warehousing (48)
Information (51)
Finance and insurance (52)
Real estate and rental and leasing (53)
Professional and technical services (54)
Administrative and waste services (56)
Educational services (61)
Health care and social assistance (62)
Arts, entertainment, and recreation (71)
Accommodation and food services (72)
Other services, except public administration (81)
Public administration (92)
Source: DWS

The table shows that, with the exception of education, most sectors vary in sympathy with changes in the mining sector. In fact, 78 percent of the jobs in the county are subject to a correlation coefficient of 0.50 or more, which is a rough measure of statistical significance.

Table 2 shows the legal location of employers of Uintah County residents. Note that 11 percent of residents are employed by Duchesne County firms, and the major industry in neighboring Duchesne County is also oil and gas extraction. This understates the importance of the Duchesne County connection; it does not include the activity of Uintah County-based firms doing work in Duchesne County. The point is that the two counties act as an integrated unit.

Table 2
Where Uintah County Residents Work
Uintah County, UT
Duchesne County, UT
Salt Lake County, UT
Utah County, UT
Summit County, UT
Daggett County, UT
Davis County, UT
Cache County, UT
Sweetwater County, WY
Weber County, UT
All Other Locations
Source: Census Bureau

Table 3 shows a list of employment multipliers for the Uintah Basin. Employment multipliers are the number of additional jobs stimulated by a change in employment for a base industry. For example, the oil and gas multiplier is 2.37, meaning that every one-job change in the oil and gas industry multiplies additional to a 2.37 job increase throughout the rest of the Basin economy. With the exception of the utilities and chemical manufacturing sectors (representing a very small share of the Basin economy), there is no other sector that has a multiplier remotely as large as that caused by oil and gas extraction.
Table 3
Uintah Basin Employment Multipliers
1. Crop and animal production
3. Oil and gas extraction
4. Mining, except oil and gas
5. Support activities for mining
6. Utilities
7. Construction
8. Wood product manufacturing
9. Nonmetallic mineral product manufacturing
11. Fabricated metal product manufacturing
12. Machinery manufacturing
17. Furniture and related product manufacturing
18. Miscellaneous manufacturing
19. Food, beverage, and tobacco product manufacturing
25. Chemical manufacturing
27. Wholesale trade
28. Retail trade
32. Truck transportation
36. Warehousing and storage
45. Real estate
50. Waste management and remediation services
51. Educational services
52. Ambulatory health care services
53. Hospitals and nursing and residential care facilities
54. Social assistance
56. Amusements, gambling, and recreation
57. Accommodation
58. Food services and drinking places
Source: Bureau of Business and Economic Research
Chart 1 shows the January 2016 U.S. Energy Information Administration (EIA) forecast for the price of a barrel of West Texas Intermediate (WTI) grade oil.. It should be noted that this grade of oil is scarce in the Uintah Basin. However, WTI is important because it is the American benchmark, and the price of Utah’s heavier crude is discounted against it.

Chart 1
Energy Information Administration 1/15/16 WTI Oil Price Forecast
(dollars per barrel)

Unsurprisingly, WTI’s price is a key statistical predictor of economic activity in Uintah County. Therefore, models estimating future Uintah County employment can be built around the anticipated future price of WTI oil.

Chart 2 shows a forecast of Uintah County employment based on the EIA oil-price forecast. This graph implies about a 13 percent peak-to-trough decline in county employment due to the collapse in oil prices.
Chart 2

Scenario: Estimated Uintah County Nonagricultural Employment Based on EIA Oil Price Forecast   

 As a point of reference, the drop in peak-to-trough employment was 14 percent from 2008 through 2009. Average WTI prices declined from $91.61/bbl. to $61.69/bbl. during that period.